Monday, May 6, 2019

Co-signing a car loan

Buying a new car is always an exciting thing. It’s fun to go to the dealership and test drive different cars and decide what you want to get. Sometimes prices can be a factor especially if you don’t have good credit. You may need someone to co-sign your car loan. You may not think that is a lot to ask if someone but it is. It’s generally not a good idea to co sign someone else’s car loan. Make sure you know them really well and trust them, even then I personally wouldn’t. You would be held responsible for the loan if they decide to stop paying. You don’t want that. You could be in big trouble if they get mad and stop paying.

I watch a lot of court shows and at least once a month there is someone who co-signed for someone’s car or put them on their cell phone plan. I understand that you want to help them but maybe giving them a loan or have them look for a more affordable car would be a better option. There are many used cars that are in all kinds of price ranges. Having the best and most expensive car is nice if you can afford it. Not everyone can buy new and that’s ok. If it runs well that’s what matters.

There are only a couple people I would ever co-sign for anything for, my mom and my son. My mom doesn’t need it but Noah is already asking me if I am going to buy him a car when he gets old enough. He’s twelve. I told him he has to work and at least help pay for it. He then asked me if I would sign a work permit for him. I said when your old enough.

I would hate to see someone go in to debt or ruin their credit by trying to help someone out. If you do decide to co-sign for someone, get a promissory note and have it notarized. Having documentation is key if they decide not to pay their car loan and you have to take them to court later.